Stock & Bonds Info

Financial Info

IR Info

Other

JGC and Partner to Promote Low-rank
Coal-Based Fuel as a Substitute for Petroleum in Indonesia

Yokohama, Japan – JGC announced today that it will be constructing a demonstration plant in Indonesia for upgrading low-rank coal into a fuel that can be used as an alternative to petroleum. This project will be undertaken as collaboration with Indonesia’s Sinarmas Group.

Indonesia is the fourth most populous country in the world, and its economy is growing rapidly. However, domestic petroleum production is declining, and in 2004, the country became a net importer of crude oil. Consequently, the Indonesian government has implemented a policy aimed at shifting the country’s energy base from petroleum to coal. Low-rank coal accounts for about 80% of Indonesia’s coal resources, so effective utilization of low-rank coal will be vital to the country’s energy security.

As an answer to this problem, JGC has developed its own unique technology that uses heat to upgrade low-rank coal into a fuel known as JCFTM (JGC Coal Fuel), which can be used as an alternative to petroleum. JGC has started to construct a demonstration plant at Karawang, near Jakarta, in cooperation with Sinarmas Group that will produce 10,000 tons of JCFTM annually. The upgrading process uses high pressure hot water to cause low-rank coal to mature artificially. The matured coal can then be converted into slurry*. The groundbreaking ceremony for the plant was held on 25th of September, and plant construction is scheduled for completion in 2011.

Japan, as the world’s largest importer of coal, has been working for some time to establish relationships with coal-supplying countries. By enabling full use to be made of low-rank coal, JGC’s new JCFTM technology is expected to benefit both Indonesia and Japan, and help to strengthen the political and economic relationship between the countries. For this reason, the project has been selected as a recipient of Japanese government agency New Energy and Industrial Technology Development Organization (NEDO)’s “International Cooperative Project for Verification and Demonstration of Clean Coal Technology” grant.

JCFTM can be used in place of petroleum products to power boilers for industrial or energy generation purposes. In the future, JCFTM could also potentially be used as fuel for power generation engines and coal gasification, or as a component in biomass combination fuels. Based on preliminary studies, JCFTM will retail for significantly less than other energy fuels. JGC and Sinarmas hope to use this demonstration plant as a platform for popularizing JCFTM, taking the first step towards the creation of a large-scale total supply chain extending all the way from mining to final retail.